Three out of four Sales Proposals fail because of basic mistakes

It’s been a long week!

So, why has it been a long week?  Because of a few statistics!

100% of Buyers know what a “Benefit” is,

but less than 10% of Salespeople
and Only 2% of Marketing people
write Benefits Statements correctly!

 

And, imperfectly written “benefits”
are NOT Benefits they are just words.

 

99% of Buyers (100% of Financial Buyers) know what a “Value Proposition” is,
but only 5% of Salespeople write Value Propositions correctly,
(I have not yet seen a Value Proposition in the Marketing Boilerplate, so they score 0%).


Since the New Year I have audited 23 Proposals, they contended against 78 Competitive Proposals,
the win statistic I can’t reveal is how many of my reviews won (due to Client confidentiality).
But you can see that 78 Proposals LOST, THREE out of FOUR are losers!

It is like missing three out of four short putts on long Par 4’s,
you have done all the hard work then you fail at the finish,
change this and you will be a Top Performer!

I launched this new product back in December 2010,

Sales Proposal Evaluation.

You e-mail me your Sales Proposal before you send it to the Prospect

then I ‘audit’ it and give it a rating 1-9.

• 1, 2, or 3 (Red), sure Loser

• 4, 5, or 6 (Amber), doubtful winner

• 7, 8, or 9 (Green), a Winner

I won’t go into the technicalities of the scoring, but I will overview results.

Red, simply means that your proposal has no Buying Reason.
Yes, the Proposal has managed to avoid giving the Prospect any reason to buy.

No Benefits, no Value Proposition, no understanding of the Prospects, needs or purpose.

A Red 2 has also failed basic proof reading, with Grammar and Spelling mistakes.

A Red 1, is actually ‘unreadable’, even if you had nothing to read on a long boring night-time train journey you would not read this Proposal. Microsoft Word detects these with its “Readability Function”, so why do Salespeople (or Marketing) continue to write ‘boilerplate’ this way.



Amber (5 and 4) will have proofreading and readability problems,
but they will also have some BUYING REASONS.
Once they have been tidied up, then they have a chance of succeeding.
They succeed only against Competitor’s Proposals ranked as RED.

If they are against a Competitive GREEN proposal you will LOSE.

Green (7 and 8) will have proofreading and readability problems, but they contain a feast of BUYING REASONS.
If sent out an un-Readable Proposal and with serious Grammar and Spelling problems they could still LOSE,
but when ‘tidied up’ they are sure winners. They cover all the BENEFITS;
they have an understandable VALUE PROPOSITION
(what some people have now ‘reinvented’ into an “outcome”).


Successful Proposals show:

• WHY the Prospect should accept your offer?
• HOW your offer fulfils their requirements and needs?
• WHAT is the Financial Value the Proposition will deliver?
  

The Proposal does all of this as simply as possible,
as unambiguously and unmistakably as possible and in as few words as possible.
Ideally in a summary with a Picture and a Chart! 

I give my Sales Proposal Rating, then my suggested corrections.

My Pricing reflects my confidence in my ability to do the Audit.

If a RED rated Proposal wins I don’t Charge, and if a Green rating that Loses then I don’t charge.
I always charge for Amber, (win or lose) WHETHER you use my suggestions or not!

£225 value, given FREE of charge

Send me one of your Sales Proposals in “Complete Confidence”,
I delete the file after you acknowledge receipt of the my rating
(test me send me one where you know the out come!)

brian.maciver@googlemail.com

Problem Based Selling is not the only way!

I enjoy The Inflexion-Point Blog, they often address current issues in Sales and Marketing and are well written. However, on The 10 Key Questions your Business Model Must Address.
http://bit.ly/eTgunI


We disagreed on the first one.

1: What business critical problems do you solve for your customers?


Why this is important: because unless your prospect acknowledges a clear and compelling business problem, you have little opportunity to sell them a solution.

This, 'Problem Solving', is still being offered as a holy grail, and certainly Prospects with a “compelling business problem” are likely to buy. But, I will not wait to find these nuggets. We have to include in the Sales spectrum Prospects that don’t have compelling business problems. Instead I also have to search for prospects that would be interested in an opportunity!

 

We label Prospects with 'compelling business problems' as “Opportunities”, but we mean THEY have a problem.
And, WE have a Sales Opportunity.




In “Opportunistic” Selling we invert this.
We look for Prospects with Opportunities then we have the Problem of delivering on it!

Prospects do signal their ‘opportunities’ to us,
with key phrases “If only…..” or
“What we really could use would be….”

Sales don’t listen because they are not
“compelling business problems”, and
they seldom fit our standard product offer!







What is the key ‘quality’ in Opportunistic Selling? Imagination!

Both Seller and Buyer need Imagination.

The rudimentary skills were initially described in Miller, Heiman and Tuleja’s “Conceptual Selling”(1987), however, in my opinion, this has now been diluted with an emphasis on 'Finding Problems' and using a Sales Process based on 'Problem Solving'.

In the original text P.280 they outline the concept of Valid Business Reason,
and in Ch. 12 they give as one Criteria of Valid Business Reason:

“Related to their business (not necessarily to your Product)”

It’s worth defining the Two Selling Styles to clarify and distinguish between them:



“Problem/Solution” Selling is based upon Problem Solving where the Prospect has
an unfavourable set of circumstances which, if not addressed, will damage their business.

“Opportunistic” Selling is based on uncovering an opportunity,
a favourable set of circumstances in the Prospect’s business environment,
which if taken advantage of will improve their Business.

This is not semantics;

it IS semantics to argue that a Customer’s "Problem" is also their "Opportunity".

Here is a Harvard Business Review article saying the same thing, but SPIN® based!
http://blogs.hbr.org/cs/2013/03/would_customers_pay_for_your_sales_calls.html

A concrete example:

A client is ordering a small incremental data storage upgrade.
They still have a single point of failure. (Which is NOT perceived by the Client as a Compelling Business Problem as the MTBF is 10 years and they have had no issues for last 3 years).

The Salesperson engages the Buyer’s imagination by asking:
“What their ‘Ideal’ Data Storage System would be, if they had no legacy system or cost constraints?”

The Prospect imaginatively describes a ‘Mirrored’ Data Storage System,
with Geographical and Mains Power separation, a truly 'no single point of failure' Data Storage System.

Now, the Prospect has an Opportunity and the Seller has a Problem,
how to overcome the Cost and Legacy constraints and take the Prospect to their “Ideal” solution.


Or, they can just take the order for the small incremental upgrade and
hope that an Opportunistic Sales Competitor doesn’t ask the same question and solve the Problems!

Top Performers 'Engage Emotionally' with Prospects

 

In looking at what makes a great salesperson, I would include a factor,
which is that: “They ‘Engage Emotionally’ with the Prospect.”

This manifests itself in that, Sales Top Performers Understand their Prospects “substantive” Issues.

Further, they are able to discern their Customer/Prospect’s “Emotional Issues”;
anxieties, fears, uncertainties and doubts,
which will often be expressed as
“Pseudo-substantive issues”.

 

 

 

These are the “Pseudo-substantive” issues that often cause the conflict
between Seller and Buyer.

The Seller “Behaviour”, which is significantly different in Top Performers,
is their ability to confront and to reconcile, reaching an agreement or harmony with the Prospect.

These conciliatory gestures may take the form of either Questions or Statements, are based on openness, which makes the Salesperson Vulnerable.  Expressions of sorrow or regret may be used for past occurrences (even if the salesperson held no direct responsibility or liability).

Top Sales Performers show a marked increase in personal disclosure;

of their thoughts, feelings, motivation and past history.

They also seek feedback and accept direct personal responsibility for the outcomes.
They are able, appropriately, to express positive feelings towards the Prospect
including affection, admiration and respect.
This is the emotional basis upon which they build, to initiate a search for mutual-gain outcomes.

Although these appear to be ‘soft skills’,
their execution and use is in ‘hard’ Interpersonal Behaviour usage.

Top Performers have a Behavioural range including Questions, Statements, Suggestions, Checking Understanding and Comment Summaries which enable a Prospect’s conversation
to encompass their Emotional Issues, comfortably.

Emotional Engagement, as I am describing it, is improvised in real time.
The Process, which is not story telling, attempts to limit 3 key factors:

· Ambivalence,
· Projection and
· Polarisation.

Buyers feel ‘Ambivalence’ about Sales People, they are both attracted and repelled at the same time,
and this is Cognitive Dissonance.  Un-aided the Buyer will adjust their perception to
“Sellers cannot be trusted” or “I trust this Person”.

Since it is the second condition, which we as sales people desire,
then we behave in a manner that engenders trust,
i.e. sincerity, truthfulness and open disclosure.

The Buyer will often ‘Project’ either their own “undesirable characteristics” onto the Seller,
or the “undesirable characteristics” of previous Salespeople  onto the Seller.

“I am economical with the truth, therefore this salesperson will also be economical with the truth”.

They do this again to reduce their Cognitive Dissonance,
we should not validate “Projected” Characteristics, and instead we establish Trustworthy Characteristics.

Finally, ‘Polarisation’ is to be avoided.
The sales person believes that they are truthful and sincere, whereas the Buyer believes sales people are inherently untruthful and insincere. Reaching agreement with Polarised views, can be impossible.
Tolerating the ambivalence can enable agreement.

Hence to move the Buyer position to:
“Sales people are inherently untruthful (their belief), but on this occasion, this seller appears truthful”.
Is congruent with their belief but allows latitude in behaviour.
The salesperson has to “accept” the Buyer’s view that “Sellers are inherently untruthful”.
Yet, exhibit behaviours that will show the Buyer’s belief ‘unjustified’ on this occasion with this Seller.

“Emotional Engagement” is for both parties Buyer and Seller, an Intra-Personal and an Inter-Personal Process. Whether we acknowledge it, or not, it is present during every Complex Choice,
and as Sellers we ignore it at our peril.

Just as an aside, this is all from Mainstream ‘Regular’ Psychology, mainly Behavioural Psychology,
i.e. the ‘SPIN’ School. However, it includes some Cognitive Psychology from CBT,
especially the view that emotions (feelings) stem from thoughts and beliefs.

It is not, “New Wave” or ‘pseudo’ Psych, or NLP,

or EI (‘Emotional Intelligence’).

 
Sales Emotional Engagement is Sales Skills based.

Behavioural Modification (B.Mod.), in our Own Behaviour to achieve an appropriate Modification in our Buyer’s Behaviour. It is akin to pre-call Questioning Preparation to identify Buyer’s needs or pain points.
The difference is this preparation is to minimise Ambivalence, Projection and Polarisation.
It used to be called “Empathy”, except we couldn’t measure or compare empathy.


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Sales forecasting and the “likelihood to win” - A ‘probability’ score.

To really understand
Sales ‘forecasting’  or Weather ‘forecasting’

you need to understand ‘Game Theory’.

 

In particular the “Game” which is called
“The Largest Number Game”,
sometimes it is called the “Luring Lottery”.

You can look it up on Google.

It starts with a ‘premise’, that every one contesting has an equal chance of winning. Then people can vary their behaviour through the use of Rational and the Irrational behaviours in an attempt to
“Increase the odds” of them winning.

Sales forecasting is a “Game”, in the absolute sense of Game Theory.

1. Some Players believe that their “Activity”, increases the likelihood of winning.
2. Some Players base their ‘Strategy’ on enhanced “Functionality” and hope to win with a better product.
3. Yet other Players trust in their “Relationships” with ‘Key Players’ in the Account,
   who are given name tags like “Coach”, “Fox”, “Ally” or “Enemy” and just plain “Insider”.
4. A large group of Players base their likelihood of winning on the “Financial” offer,
   this can be TCO, ROI, or Discounted Cash Flow (DCF) based.
   A popular way of phrasing this is to make a “Value Proposition” which will be literally:
   

   “Make them an offer that they can’t refuse!”

So, what do we know about Sales forecasting?

Well, surveys and research shows it to be pretty ineffective.
The likelihood of the Sales “forecast” for any individual deal being accurate is about the same as
the weather forecast for rain in the Desert or sunshine in Manchester. Sometimes they get it right!
What about “Collective” or “Aggregate” forecasting? 
Well, even if you do sell aggregates or collectives, they are not much use!

Like the lottery, the more “tickets” that you buy then the more likely you are to win.

Does this apply to Sales?
The more deals you try to close the more likely you are to close ‘some’?

No? Well no, not really.
It doesn’t work that way.

We know this because of the Sales People and their Sales Managers who worry about Activity, Functionality, Financial offers and Relationships. If these are not ‘right’, then your likelihood of success is diminished.
We didn’t even include the Competitors;
if there are THREE Competitors then TWO of the Sales forecasts are going to be wrong by definition!
We live in a Complex world, ‘forecasting’, especially Sales Forecasting could be characterised as:
“Calculated Chaos” or “Controlled Disorder”. In fact, Sales Forecasts are needed to give a semblance of Control; and Control is needed so that Planning can be ‘fulfilled’.

The truth is Forecasting has not progressed much since Greece 2,500 years ago.
Where the Oracles at Delphi, (now known to be intoxicated by the ‘Volcanic’ fumes)
made predictions.
We still believe that prophecy, that is given by “talented seers”, even if removed from the hurly burly can foretell coming events.

 

 

Magic!

 

 

 

 

 

 

What is really produced is ‘pseudo-information’ about relationships, function, finance and activity, which is then processed through ‘intuition’ and ‘calculation’ to generate a number.

The oxymoron springs to mind:

“A long range weather forecast should be obtained before leaving,
  as weather conditions are extremely unpredictable!”

My belief is that Sales Forecasting, especially long range forecasting is a manifestation of anxiety-relieving superstitious behaviours.

 

Sales forecast reviews are no more than “magical rites” to make a chaotic world seem stable. These rites are practiced by the Executive Management Tribe to induce us (sales people) to take action, at least when the ‘Omens’ are favourable.

The use and abuse of sales forecasting simply preserves a Status Quo.

Weather Forecasters talk of unexpected “Turbulence”, and Sales VP’s call it “Downturns”.

I have previously Blogged about the Forecasting method which I use that,
given all the truths above, it is as useful as any, and a lot better than most “systems”.

 

http://brianmaciver.blogspot.com/2010/07/sales-forecasts-its-numb3rs-game.html

 

No doubt,
many people with ‘systems’ and ‘solutions’ will disagree with me.

But, before you buy,

ask them to bet their House and Pension on it,

before you bet your Company on it!

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Who should carry out the Sales Negotiation?

 

I have run Negotiation Skills Training for more than 20 years.

 

BMAC Consulting ExtraOrdinary Negotiation Skills are based upon:
Game Theory Strategies and Verbal Behaviours. These have both been Validated by a wide range of academics and practitioners.

“The proof of the pudding is in the eating”,
   and sometimes I noticed it didn’t work!

People who had attended the training and who had done well in the Classroom ‘failed’ to “transfer” the skills to the Real World.

I have followed up on this quite extensively
and noted the following paradox:

 

 

after training People knew what to do, but didn’t always do it!

It is irrational, but it is also true. They had the tools to create win/win outcomes, but they were often sub-optimizing the outcome. They were too “soft” in some situations, Customers, Family and Friends and too “tough” in other situations Shops, Restaurants or with complete strangers.
On examination, these “Skilled” Negotiators were failing to use their skills appropriately;
in fact their behaviour was ‘unaligned’ to the outcome.

The missing factor was ‘empathy’.

In situations where they had strong empathy,
they were failing to align their behaviours and use appropriate strategy.

In situations where they had little or no empathy,
they were simply going for the single win, a “Bully” strategy.

Neither was particularly effective.

 

What does this mean?

It means that Low to Medium empathy seems to be the right amount to provoke correct strategy and aligned verbal behaviours. This level of empathy is more usual in second line staff, Sales manager, Financial Director or CEO.

When we come to negotiation (not Haggle) then,
the Salesperson is NOT always best.

Check their empathy for the Account
BEFORE you let them negotiate!

 

 

 

 

And, check the Sales Manager, FD or CEO for SKILLS
before you ask them to negotiate, instead of the Salesperson.

 

 

 

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"shortening sales cycles"

The most effective way of shortening the selling cycle is to arrive at the very end of the buying cycle. If your buyer is going to decide tomorrow, you will have a selling cycle of less than 24 hours!

Usually, in fact almost always, you won't get the deal.
But, the upside is you have only lost one day!

Other sales people, who started a year before you,
they will have wasted a whole year!

I once visited the flight deck of a 747 Jumbo Jet.
I was overwhelmed at the number of dials and indicators. The Captain patiently explained to me the purpose behind each one.
Fuel Gauge and Fuel Burn Rate.
Altimeter and Vertical Speed.
Air Speed and Forward Looking Radar. 
Each Indicator or Measure giving critical information for the effectiveness or the security of the airplane and their passengers.

 

 

 

But there was one gauge, not mentioned,

marked from 40% to 100%,
with Green, Amber and Red zones.

Pointing to this colourful gauge, I asked “what is that one for?”

“That’s the External ‘Humidity’ Gauge.” replied the Captain.

"But, what is it for?" I persisted

The Captain smiled widely and then answered
“That’s so we can answer a head office Executive’s question, ‘Is it raining outside?’”

“But, that’s not really relevant, is it?” I asked.

“No, but in Sales you have head office Executives who pour over
the ‘Sales Cycle Time’ figures don’t you!”  He replied.


I have to say that, this is the same Aircraft Captain who caused Kaplan and Norton
to write their book “The Balanced Scorecard”, and create "Dashboards"
in response to the Captain flying from New York to London
using ONLY his Altimeter.

They had however, booked a flight from New York to Chicago!

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The problem of Sales and Marketing Alignment

 

I always smile privately while reading Sales-Marketing or Marketing-Sales Alignment Problems Blogs and Reports.

An exception
is the great advice given by:

http://blog.eloqua.com/sales-alignment/

However, Forrester, a respected Research and Publishing House. The author has a Marketing background, but he lacks that ‘Grunt’ experience. Having been a ‘Grunt’ that worked and educated himself to General Management, I know how essential that experience was, and I know how important to have perspective on the “Problem”.

The ‘shocking’ conclusion is:

“Sales and Marketing Alignment starts at the Customer”,

forgive me but I feel as though a Consultant has just borrowed my watch,

told me the time, billed me $500 and then kept my watch!



The Problem is in Marketing, they can’t keep up.

Marketing cannot keep up with Social, Technological, Economic, Political or Competitive change!
Sales, at the ‘front-end’ attempts to use out of date marketing content, are directed to inappropriate leads, and most importantly are blamed for failure and then discredited for their success. I long for the return of Sales and Marketing Directors, Marketing Communications, PR, Customer Events,
Golf balls and Umbrella give-away!
I would trade both my SFA and CRM for them, and settle for just MS Outlook.



Instead, I have to suffer the indignity of the CMO,
we might as well have had Sales report to the CFO, 
as at least in Finance they understood the Financial Offer!  
Marketing are there to serve the Sales-force, not the other way round!

Marketing Deliverables are the Sales-force requirements to SELL,
not a ‘price list’ with a product brochure and an inoperable website.

Then, God forbid, a plethora of Sales ‘Disablement’ content, SFA and CRM software, FAD training programs, Market Focus meetings and the fatal blow a “sales strategy” based on a (wrongly labelled) Boston Matrix,
a SWOT analysis that left out the Key Competitor and was based on the wrong Market segment
and a no longer sold Product.

Within 5 minutes of meeting a CMO, I can tell if they have any comprehension of Selling or not.  If they don’t think much of Salespeople and if they believe that Customers are naïve, then they are unlikely to align.


I have been much more measured in my assessment of their Marketing and CMO skills, waiting a full 18 months,
to see what they achieve.
In ITC my expectation is 35% year-on-year at the top line.
This is rarely achieved by CMO’s unaligned to Sales and Customers!

 

What is often achieved is the complete disengagement from both Sales and Customers;
to the point that the CMO believes that “they are in the ‘wrong market’.”

When CMO’s directly manage Sales, as “Sales” Management this has been disastrous,
with the loss of Market share, Key Employees, and inconsistent Sales Strategy of both Product and Position.

 

The outcome is OVERT Marketing - Sales - Customer misalignment.


I have reached a different conclusion, than Forester, Sales and Marketing misalignment is the CEO’s fault!

Sales and Marketing misalignment
is completely the CEO’s fault.

The structure of a ‘disintegrated’ Sales and Marketing Department is wrong, it doesn’t work. 
It’s not about ‘alignment’; it’s about “Integration around the Customer”.
Sales, Marketing and Service integration,
which delivers Customer Acquisition, Retention, Development and Substitution the FOUR Sales Strategies!

 

My advice to 'misaligned' CEO’s is  this month spend
at least 20 hours with Customers LISTENING, not talking.

Then do the same thing with the Sales and Marketing Departments,
Fire the CMO and any other Marketing person with a title that doesn’t have the word “Customer” in it.
Fire all Marketing people who do not spend at least 10 hours per month with different Customers.
Fire all Salespeople who don’t spend 40 hours per month eyeball to eyeball with different Customers.

More on integration at http://brianmaciver.blogspot.com/2010/09/sales-and-marketing-integration.html

Hold a series of Meetings with the Integrated Sales and Marketing Department,
ensure they know and have agreed the Ideal Customer Profile (ideally based on real customers),
they have agreed the definition of a Sales Ready Lead,
as well as an agreed handover and hand-back process for Sales [un]Ready Leads.

 

Good Luck!

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